Why Advertisers Should Care About Net Neutrality

You’ve seen it all over the news. You’ve seen it trending on social media for days at a time. You’ve likely talked about it with friends and colleagues. After the FCC voted to kill net neutrality, people everywhere rallied to save it by urging Congress to overrule them using the Congressional Review Act. Without net neutrality, everyday consumers’ Internet behavior could be affected. Battle for the Net was created to help raise awareness about the issue and encourage people to voice their opinion to Congress. The repeal would also have major implications on the advertising industry. As an advertising professional, whether you are at an agency or in-house, it’s important to stay informed on how the repeal of net neutrality could affect your job.

The central question surrounding net neutrality is whether or not the Internet should be considered a public utility or a commodity. As it stands now, the Internet is seen as a public utility in which every user has equal access. The FCC ruling showcased that they thought of it as a commodity, therefore, it could be subject to up-selling. Who would be responsible for the up-selling? Internet service providers like Comcast & Verizon. These companies could be given the right to slow digital content or charge for preferential treatment.

It’s clear Internet users stand to lose quite a bit, but advertising professionals do as well. To begin, the price of Internet ads will noticeably increase. If these website costs go into effect, companies will have to pay more for their content to be seen by consumer. Advertisers must be weary of increased CPM which ultimately leads to lower ROI.

Professional ad organizations have worked tirelessly and invested a lot in standardizing viewability metrics for industry use. A slower Internet connection means many ads will not load as quickly as they used to, therefore rendering previous standards. Many advertisers would have to revisit their KPIs in gauging ad performance with these changes in mind.

Another factor to keep in mind is placement of the ads. Many ISPs own media companies (ie. Verizon with Yahoo! and AOL). It is likely that publishers could cut deals with providers to ensure their preferred content would not count against user data plans. Advertisers would have to be cognizant of these partners while also keeping in mind that these preferred media firms could hike up ad prices.

Without net neutrality, we would likely see an advertising marketplace where brands with larger ad budgets thrive while challenger brands and startups fade. Competition would heighten as brands try to outspend one another to get the recognition they once did from advertising. Those with smaller budgets would need to get creative in how they reach their target audiences.

The FCC voted in December 2017 to repeal the 2015 net neutrality regulations, which prohibited broadband providers from blocking or slowing down traffic and banned them from offering ways for companies to pay extra to reach consumers more quickly than competitors. Parts of the order went into effect on April 23, 2018, but many significant changes still need to be approved by the Office of Management and Budget.

With all these measures taking effect at a national level, many net neutrality supporters have not yet given up hope at a national level. Several stateshave passed their own measures to counteract what’s going on at a national level. If any of these possible changes concern you as an advertiser, it is important to make your voice heard to those who represent you at a state level. Reach out to your current local representative, Ted Cruz, to let them know how you would be affected personally and professionally without net neutrality. There is also a midterm election coming up in November 2018. Ad 2 Dallas encourages you to do your research on candidates to get their stance on net neutrality. If you have any questions about how to make a difference, please reach out to us at ad2dallas@aafdallas.org.